Thursday, Jun 24, 2010
About time too!
Yorkshire Post: Ros Altmann: At long last, public sector pensions move on to the agenda
And I'm not attacking the public sector when I say it's time to stop the pensions apartheid.
Posted by mr g @ 09:08 PM (420 views) Add Comment
11 Comments
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1. Talman said...
I am a civil servant and understand the source of frustration surrounding public service pensions if you're in the private sector. But we all had free will for our careers and those in the private sector who are now suffering the loss of final salary pensions are there because they opted for the private sector. I'm sorry but that is the truth - the elephant in the room. If pensions were that important to you rather than salary why didn't you join the public services instead. Simple, you wanted more money for your work. That was your choice. However, I have little sympathy for those who now feel bitterness and now vent their frustrations and jealousy by now seeking to erode the the rights of public servants by jumping on board with the government's "affordability / pension landscape" sound-bite band-wagoning. Everyone knows that civil service pay is crap but the point is that most non-careerist or senior civil servants have provided everyone else with public services on the cheap because of our elected trade - off between private sector comparable salary and civil service terms & conditions and pensions. And don't say that there has been no such trade - off. Civil Service pay rises have always been significantly below the national average and at every pay bargaining round that I have witnessed in 20 years, the government has held aloft the pension and terms & conditions as a compensatory equaliser to appease the trade union side. They now want their cake and to eat it. Shall we have a retrospective correction of decades of civil service salaries now that we are so keen to align the private and public sectors? Are we now also going to attack police and military pensions. Are they any more affordable?
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3. Bigbadbob said...
When you say "pension apartheid", aside form it being a grotesque choice of phrase, are you proposing lowering public sector pensions to the levels of private sector pensions that have been unfairly decimated in the name of greed or are you proposing raising the private sector pensions to match the average public sector pension?
Would you lower men's pay to match women's pay in the name of equality also?
4. techieman said...
The basic premise of pensions should be that you get what you pay in invested over time. The contributions can attract tax relief and the pensions themselves are taxable.
Final salary schemes are a by-product of a boom. The returns required to secure a fully funded final salary scheme are such that they can only occur in a bubble or neo bubble period. Therefore the only sensible alternative for business is (aside from large employee contributions) is to have a money purchase base.
That holds true whether it is a private sector employee or a public sector one. Relative to the public sector the position is worse when the shortfalls in superannuation funding MUST be supplemented by taxes to provide the benefits under the final salary schemes. This is even more true when public servants have their last 3 years salary increased purely to increase their pensions (and yes i know this has happened in the past).
Therefore i believe all final salary pensions (private or public) should be finalised. i.e. existing benefits secured but new benefits determined by money purchase only. My view is that is necessary in both sectors, but of course if a private company can adequately fund a fully funded final salary scheme, then whose to argue?
5. letthemfall said...
Ros Altmann tends to come across as glib and not that well informed. It's an indication of the steady march towards greater inequality in this country that the desire to wreck all pensions is so strong: private ones have been screwed, so now let's screw the public too. A few things she fails to mention: some public schemes have already had their retirement ages and contribution levels raised; the Civil Service now runs a defined benefit scheme (it's old non-contrib final salary scheme gone). How is she not aware of this?
6. letthemfall said...
That should be defined contribution (ie money purchase), not def benefit
7. Enough Already said...
About time too! Why should public sector workers expect to carry on as normal, while the private sector takes all the hits? This always has been discrimination in its ugliest form. Apartheid, sure enough.
Captcha - neutron bathmats
8. simon68 said...
At least I know private employers won’t be able to touch money held in pension trust fund (money is being held in a designated account with trustee separate from fund managers) for the benefits of its employees.
Whereas the UK government embezzle the NI contribution to meet its day to day government expenditures; so no pension payout for both civil servants and state pensioners.
9. Mr G said...
@LTF Good afternoon
"Ros Altmann tends to come across as glib and not that well informed."
This is meant as a gentle tease, do you ever concede that someone writing an article other than in the Guardian or Independent may have a valid point?
10. mr g said...
@LTF Good afternoon
"Ros Altmann tends to come across as glib and not that well informed."
This is a gentle tease, do you ever concede that someone writing an article in other than the Guardian or Independent might have a valid point to make?
11. letthemfall said...
Good afternoon mr g
I believe Ms Altmann has published in the Guardian before.